In Jones v Esurance Ins Co, Court of Appeals No. 351772 (Feb 25, 2021), the Court of Appeals addressed a number of issues in a case for no-fault benefits, including res judicata, tolling, the one year back rule, and a motion to change venue.
Procedurally, the case was convoluted. On August 8, 2005, plaintiff was involved in a motor vehicle accident in Kentucky. Two years later, he filed suit for no-fault benefits in Kentucky. In 2013, while the Kentucky lawsuit was pending, plaintiff filed a complaint in Wayne County, Michigan. In 2014, the Wayne County Circuit Court dismissed plaintiff’s complaint under MCR 2.116(C)(6), which permits dismissal of a claim because “[a]nother action has been initiated between the parties involving the same claim.”
On December 17, 2013, plaintiff filed a motion in Kentucky asserting that Michigan law applied to plaintiff’s claim and requesting that the Kentucky court “transfer” the litigation to Wayne County, Michigan. In 2014, the Kentucky court entered an order purporting to “transfer” the case to the Wayne County Circuit Court. The order also included a provision which purported to toll the operation of the one year back rule.
In December of 2015, the Wayne County Circuit Court received the Kentucky court’s “transfer” order. On May 1, 2017, defendant filed a motion for summary disposition arguing that the earlier grant of summary disposition in Michigan barred plaintiff’s “transferred case” under the doctrine of res judicata. The Wayne County Circuit Court granted the motion and plaintiff appealed. On appeal, the Court of Appeals vacated the trial court’s grant of summary disposition because plaintiff had failed to properly invoke the trial court’s jurisdiction by filing a complaint. The Court of Appeal’s allowed plaintiff a reasonable time to file a new complaint that conformed with Michigan court rules.
On May 16, 2019, the plaintiff filed a new complaint in Wayne County. Plaintiff also moved to change venue from Wayne County to Washtenaw County where a similar action was pending. Defendant once again filed a motion for summary disposition asserting plaintiff’s newest complaint was barred by the doctrine of res judicata. Defendant also argued that the one year back rule applied to plaintiff’s action and that the defense attorney in Kentucky did not waive defendant’s right to assert this rule. The Wayne County Circuit Court determined that defendant did not explicitly waive the one year back rule and also found the matter barred by the doctrine of res judicata. Plaintiff once again appealed.
This time the Court of Appeals found that because the original grant of summary disposition in the first Michigan case was based upon MCR 2.116(C)(6), and the issue in that case was only whether another action had been initiated between the same parties and the same claims, there was not an adjudication on the merits of the claims raised in the present case. The Court of Appeals affirmed the trial court’s finding that the defendant did not explicitly agree to toll the one year back rule. The Court of Appeals rejected plaintiff’s argument that the 2019 amendment to MCL 500.3145 added a statutory tolling provision to the one year back rule which should be applied in this case. The Court of Appeals noted that statutes and statutory amendments are presumed to operate prospectively and the text of MCL 500.3145 shows the Legislature did not intend for the new tolling provision to be retroactive. Finally, the Court of Appeals determined that venue was proper in Wayne County because it was alleged defendant resided in Wayne County and defendant conducted business in Wayne County.
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Sarah Nadeau, Editor of The Garan Report Publication, is a Shareholder in our Detroit Office. Sarah can be reached at 313.446.1530 or snadeau@garanlucow.com